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Thursday, October 30, 2008

Investors got the Blues - PhotoHunt

PhotoHunt theme : Blue

A lowly-educated cousin was misled into putting her life-savings into a high-risk financial product. She is in her fifties, a blue-collar worker, does not understand English. She holds 2 jobs, scrimped and saved for 30 years to accumulate S$100,000.

Her money was initially placed in a Fixed Deposit but a Relationship Manager sold her the high-risk financial product, promising her higher returns but did not mention about the risks involved.

My cousin was asked to put her signature on blank forms and the Relationship Manager filled in her particulars and answered the questions on the Fact Finding/Analysis Sheet on her behalf. Yes, she is too naive stupid.

But this is Singapore. The ordinary citizens trust that the authorities have stringent controls and regulations in place. Who would expect such things to happen?

The redemption value of that product has been calculated to be zero. The news came as a bolt from the blue.

I was with my cousin for the closed door DBS Dialogue Session on the failed financial product, High Notes 5. All the investors were angry and many elderly ladies were in tears.

Aggrieved investors remain dissatisfied with DBS despite being informed that those who have invested up to S$100,000 (as opposed to the current limit of S$50,000) can take their case to the Financial Industry Disputes Resolution Centre (FIDReC).

Rajan Raju, Managing Director and Head of Consumer Banking at DBS Bank and the bank's independent external adviser, Gerald Ee, met the investors.

My cousin was given an investor complaint form, which establishes among other things if there was mis-selling, to fill. DBS will review it on a case-by-case basis.

DBS Bank has said it will review every High Notes 5 case, and its investor will know the outcome of the resolution process by the end of the year.

Legal advice was against pursuing a class action suit. It’s an uphill task to prove mis-selling in a court of law. It’s our word against the Relationship Manager’s.

Who are responsible?

After the dialogue session, I met several investors from Malaysia, China, Taiwan and Korea. These days, I have been helping my cousin's elderly, uneducated colleagues and neighbours who have invested in such high-risk financial products to write complaints.

I get the blues seeing the elderly not being able to eat and sleep over the loss of their life-savings. Some have fallen ill. I hope there would not be suicides.

I hope more educated people could come out to help these vulnerable investors. Just help them to fill in their investor complaint forms in English or Chinese. There will be a meeting for investors at :

Saturday 1 November 2008
Time: 5 - 7 pm
Nearest MRT station: Clarke Quay (NE Line)

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